White House Won't Back Tesla In Direct Sales Fight

Hunter Walker, provided by

Published 10:12 pm, Monday, July 14, 2014

The luxe electric car company Tesla Motors is not very happy with the Obama administration.

Last Friday evening, the White House rejected a petition asking it to "allow Tesla Motors to sell directly to consumers in all 50 states." The company responded with a statement of its own criticizing the White House's response as "disappointing" and "timid."

Tesla has been battling multiple local governments over its direct sales model. The position calling on the White House to support the company was posted June 5, 2013 and earned the 100,000 signatures necessary for a White House response within its first month.

The White House response, which was written by Dan Utech, a special assistant to the president for energy and climate change, said, "as you know, laws regulating auto sales are issues that have traditionally sat with lawmakers at the state level." Utech went on to cite several initiatives the administration had launched "in promoting vehicle efficiency."

Diarmuid O’Connell, Tesla's vice president of corporate and business development, responded with a statement Monday that said the White House was not showing "leadership" on the issue.

"138,469 people signed the petition asking the White House to allow Tesla Motors to sell directly to consumers in all 50 states. More than a year later, at 7.30pm EST on Friday as most of America prepared for the weekend, the White House released its disappointing response to those people. Rather than seize an opportunity to promote innovation and support the first successful American car company to be started in more than a century, the White House issued a response that was even more timid than its rejection of a petition to begin construction of a Death Star,"O’Connell said. "Instead of showing the sort of leadership exhibited by senior officials at the Federal Trade Commission who declared their support for consumer freedom of choice, the White House merely passed the buck to Congress and trumpeted its advances in promoting vehicle efficiency. Given the economic and environmental principles at stake, we would have hoped for stronger leadership and more action."

Thanks for your We the People petition. We're excited about the next generation of transportation choices, including the kind of electric vehicles that Tesla and others have developed. These companies are taking steps to help spur innovation in the promising area of advanced batteries and electric automobiles. Vehicle electrification and other advanced technologies are vital components ofPresident Obama's Climate Action Plan, and his commitment to addressing climate change and reducing carbon pollution, in addition to reducing our dependence on oil.

But as you know, laws regulating auto sales are issues that have traditionally sat with lawmakers at the state level.

We believe in the goal of improving consumer choice for American families, including more vehicles that provide savings at the pump for consumers. However, we understand that pre-empting current state laws on direct-to-consumer auto sales would require an act of Congress.

We are already making significant progress in promoting vehicle efficiency: new vehicle fuel economy has increased by 12% since 2008 and consumers now can choose from five times more car models with a combined city/highway fuel economy of 30 mpg or more, compared to just five years ago. In December 2013, the Environmental Protection Agency (EPA) announced that model year 2012 vehicles achieved an all-time high fuel economy, after increasing seven of the last eight years.

The President has taken historic action to spur more consumer choice -- saving consumers money at the pump and reducing our dependence on oil. Here are some of the ways we're helping to encourage the future generation of energy-efficient cars:

In 2012, the Obama Administration finalized groundbreaking standards that will increase fuel economy to the equivalent of 54.5 mpg for cars and light-duty trucks by Model Year 2025. These standards will save consumers more than $1.7 trillion at the gas pump and reduce U.S. oil consumption by 12 billion barrels. And this spring, we also released standards for medium- and heavy-duty trucks, a move that will save vehicle owners and operators an estimated $50 billion in fuel, and save a projected 530 million barrels of oil. You can learn more about that here.

The Department of Energy (DOE) has a loan program to help spur the kinds of innovation needed to create the future of transportation. In fact, Tesla's electric car won the 2013 Motor Trend Car of the Year while repaying its DOE loan 9 years early and earning the taxpayers about $17 million in profit. And DOE's loan to Ford Motor Company to upgrade 13 factories across six states and to upgrade the fuel efficiency of a dozen popular vehicles has supported 33,000 jobs across the United States.

In September 2013, DOE awarded $45 million in funding for 38 new projects that to improve fuel efficiency, lower transportation costs, and protect the environment. The 38 new projects support the goals of the EV Everywhere Grand Challenge, a public-private initiative to make EVs as affordable and convenient to own and drive as gasoline-powered vehicles within 10 years. Also as part of EV Everywhere, DOE has launched the Workplace Charging Challenge, with a goal of achieving a tenfold increase in the number of U.S. employers offering workplace charging for plug-in electric vehicles in the next five years.

As these initiatives show, the Administration is in favor of fostering competition in the market to help spur the kinds of innovation needed to support ongoing U.S. leadership in vehicle manufacturing and a potential range of new technologies.